EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0829698
Customs Act 1901
Background
Part XVA of the Customs Act 1901 (the Act) sets out a scheme under which Tariff Concession Orders (TCOs) may be made by the Chief Executive Officer of Customs (the CEO). A lower rate of customs duty applies to goods that are the subject of a TCO.
Under section 269F of the Act, a person may apply to the CEO for a TCO in respect of goods. If the CEO is satisfied that the application is not in respect of goods specified in section 269SJ of the Act, which sets out those goods that cannot be subject to a TCO, the CEO must decide whether the application meets the core criteria.
Section 269C of the Act provides that a TCO application meets the core criteria if, on the day on which the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. Section 269B of the Act provides that ‘goods produced in Australia’ has the meaning given by section 269D, ‘ordinary course of business’ has the meaning given by section 269E and ‘substitutable goods’ in respect of goods the subject of a TCO application, means goods produced in Australia that are put, or are capable of being put, to a use that corresponds with a use (including a design use) to which the goods the subject of the application can be put.
Subsection 269P(3) of the Act provides that if the CEO is satisfied that a TCO application meets the core criteria, the CEO must make a written order (a TCO) declaring that the goods the subject of the TCO application are goods to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 (the Tariff) specified in the order applies.
Cinqplast Plastop Australia applied for a TCO in respect of certain balls on 04 September 2008.
Instrument
TCO No 0829698 was made on 28 November 2008. It declares that those certain balls are goods to which item 50 of Schedule 4 to the Tariff applies since the CEO was satisfied that no substitutable goods were produced in Australia. The general rate of duty on these goods is 5%. The rate of duty for the goods subject to the TCO is free.
Consultation
Subsection 269K(1) of the Act provides in part that as soon as practicable after accepting a TCO application as a valid application, the CEO must publish a notice in the Gazette which includes an invitation to any person who considers that there are reasons why the TCO should not be made to lodge a submission with the CEO. The CEO did not receive any submissions in response to this invitation.
Commencement
Subsection 269S(1) relevantly provides that a TCO is to be taken to have come into force on the day on which the application for the TCO was lodged. TCO No. 0829698 is taken to have come into force on 04 September 2008.
The TCO does not affect the rights of a person (other than the Commonwealth) as at the date of registration so as to disadvantage that person or impose liabilities on a person (other than the Commonwealth) in respect of anything done or omitted to be done before the date of registration. The rights of importers will be beneficially affected. Under paragraph 126(1)(r) of the Regulations, importers of such goods will be able to apply for a refund of duty on goods imported since the day on which the TCO is taken to have come into force. The TCO does not impose any liabilities on any person.
Overview
The Tariff Concession Instrument No. 0829698 was introduced to provide relief to Cinqplast Plastop Australia in the form of tariff concessions for certain balls, under the Customs Act 1901. Enacted by the relevant legislature, this instrument was designed to address the gap in tariff rates for goods that are not produced in Australia and do not have substitutable goods locally available. The Customs Act 1901 sets out the process for making such tariff concession orders, where the Chief Executive Officer of Customs determines whether an application meets the core criteria, including the absence of substitutable goods produced in Australia. The policy objective of this instrument is to provide tariff relief to importers, facilitating more competitive pricing for goods entering the Australian market, and ensuring that importers are not disadvantaged by the absence of local production.
Scope and Application
The Customs Act 1901, through its Tariff Concession Orders (TCOs), applies to the assessment and imposition of customs duties on imported goods, facilitating tariff concessions for specific goods when certain conditions are met. This legislation is administered by the Chief Executive Officer of Customs (CEO) and pertains to any individual or entity applying for tariff concessions on goods not produced in Australia in the ordinary course of business. The scope of the Act is national, covering all imports into Australia, and is not restricted to specific industries or types of goods, except as outlined in section 269SJ. The CEO is mandated to review applications under section 269F and make a written order if the application meets the core criteria, as specified in section 269C. The instrument, TCO No. 0829698, exemplifies this process by granting a tariff concession on certain balls, reducing their duty from 5% to free, effective from the date the application was lodged. The Act also includes provisions for public consultation and ensures that the rights of existing parties are not adversely affected by the concessions granted.
Key Provisions
The main operative sections of the Customs Act 1901, particularly under Part XVA, establish the framework for the creation of Tariff Concession Orders (TCOs). Section 269F allows for the application to the Chief Executive Officer of Customs (CEO) for a TCO in respect of specific goods. If the CEO determines that the application pertains to goods not excluded under section 269SJ, they must then assess whether it meets the core criteria outlined in section 269C. This requires confirmation that, on the date the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business, as defined in sections 269D and 269E. If these criteria are met, the CEO must issue a written TCO, as stipulated in section 269P(3), declaring that the goods are subject to a specified item of Schedule 4 to the Customs Tariff Act 1995.
The Act imposes several obligations on the parties involved. The CEO is required to assess the validity of TCO applications and determine if they meet the core criteria. This includes verifying that no substitutable goods were produced in Australia at the time of application. Additionally, under section 269K(1), the CEO must publish a notice in the Gazette inviting submissions from any person who believes the TCO should not be made, ensuring transparency and opportunity for stakeholder input. Cinqplast Plastop Australia, as the applicant, must provide sufficient information and evidence to support their application for the TCO. Once a TCO is issued, importers of the specified goods can apply for a refund of duty paid on those goods imported since the date the TCO was deemed to come into force.
Failure to comply with the requirements of the Act can lead to various consequences. For instance, if the CEO fails to properly assess an application or issues a TCO without meeting the core criteria, this could result in legal challenges or nullification of the TCO. While the explanatory statement does not detail specific offences or penalties for breaches, the Customs Act 1901 generally provides for a range of administrative, civil, and criminal penalties for non-compliance with its provisions. These could include fines, imprisonment, or other penalties as prescribed by the Act, depending on the severity and nature of the breach. The exact penalties would be determined by the courts, taking into account the specific circumstances of the non-compliance.